A story is something you tell after a series of events. It's an implied interpretation of the relationship of those events.
According to traiditional narrative theory, a story begins with a status quo, a world in order. Then, something happens which throws things out of whack. The hero finds themself in this new out-of-whack world, and they can't go back to the old world. The hero then must 'gather forces' (round up a posse, or grow, or learn something) to overcome some obstacle. Once the obstacle is overcome, the hero is in a new status quo.
So, if you're narrarating a series of events, and you want it to be a story instead of a list of somewhat related things that happened in chronological order, you will have to bind each event to an element of the narrative story. So, you have to know in advance which events are which elements of the story. Is the slaying of a dragon the final showdown of the 3nd act, or the world-shattering event that marks the transition from the 1st to the 2nd act? That decision can only be made once you've decided which parts are which.
In quasi-narrative games, such as Final Fantasy type RPGs or choose-your-own-adventure books, the authors have already thought out one of several narrative threads in advance.
The basic problem here is that computers don't have enough AI to be a narrarator, to tell a story. You either have to have 1. built-in storylines, which are already programmed into the game before you being playing, and you get to hear the next bit if that dragon doesn't kill you , or 2. A totally free form MMORPG with great AI NPCs, or a lot of other human players.
Remember, a story doesn't happen, it's told after the fact.